Before making a move into the cloud, get educated on the principles and definitions of cloud computing, advises Johan Goossens, head of NATO's Allied Command Transformation's (ACT) Technology & Human Factors Branch in Norfolk, Va.

"We started in the summer of 2010 with educational efforts. We got ourselves smart on the terminology, sitting down with vendor partners," he says.

"Before we got started with the cloud, we made sure that we had a good grasp of our application inventory," says Pedro Villalba, CTO at EmblemHealth, a health insurance provider in New York.

"We identified which applications are driving the business, and then determined which ones need standalone environments. We found a lot of applications, because of the way they've been built, don't lend themselves to be used in a cloud strategy unless they're completely reengineered," he adds.

Once he had wrapped up the application inventory, Villalba says he had a clear understanding of what applications would work well in a virtualized cloud environment.

3. Put together a sample business case

"Cloud is not magic. It's not a silver bullet or a panacea. It's an implementation of technology with certain advantages and characteristics," says Mark White, CTO for Deloitte Consulting's technology practice. "Like in any implementation, particularly when you're trialing activities, we recommend CIOs do a business case as a first experience."

The good news is, the public cloud lends itself to "sticking a toe in the water and doing a first department, geography or use case, as in a first workload to move to the cloud," White adds.

Take into account factors such as the characteristics of cost, the expected return on investment categories and hurdle levels, SLA and performance expectations, service characteristics - what is this doing for me and how - and measure those after the fact.

David Linthicum, CTO at Blue Mountain Labs, a cloud consulting firm, and cloud computing blogger at InfoWorld, a Network World sister publication, agrees. "Most of my clients have prototypes going on and that's what I recommend they do," he says.

"If someone comes to me and says, 'We want to look at infrastructure as a service to solve our storage needs,' I say, 'Well that's great, but let's first understand what that is from an academic perspective and then let's look at the business case,'" he says.

"That's the best way to understand the capabilities of the cloud and how it works in context of your system," Linthicum adds. "You might spend maybe a couple hundred thousand dollars in time and effort in doing this, but you'll get something that can end up saving you millions of dollars if you pick the right solution."

4. Keep expectations in check

If you're going to set up a private cloud, you want to make it as simple to use as Amazon's Elastic Compute Cloud (EC2). "Go ahead and empower users with self-service and the ability to deploy an application in 15 minutes, but do those things while setting the right expectations," says James Staten, vice president and principal analyst with Forrester Research.

For example, IT must make four caveats crystal clear to application developers: Some workloads will be restricted from running in the private cloud; the SLAs for the cloud are more similar to what a user would get from Amazon than the corporate data center - meaning, they shouldn't expect to call IT at two in the morning if a private cloud app falls over; they must commit to an expiration date for the workload; and running that workload in the private cloud will cost your department, and here's how much.

"Once all that is clear, then at a lot of companies it becomes a matter of, 'You can deploy in 15 minutes once your request is approved,' but that doesn't mean by IT, because you want to get out of the way. That approval might come from an enterprise architect, the application development manager or the like," he says.

If your private cloud looks and feels too much like EC2, developers will play there and in a big way, Staten cautions. "That could exacerbate virtual machine sprawl - if you don't create an appropriate cost model, for example, that's like giving them EC2 without a bill and in that case they'll never have any reason to leave. You'll have virtual machines coming in but never going away."

5. Chose a fast path to private cloud

In other words, buy a cloud-in-a-box product, Staten says. "This makes so much sense because of the urgency and priority around the cloud right now."

Cloud-in-a-box products come in two variants, he explains. You can get a software cloud in a box, and then provide the specified hardware and infrastructure below that. That'll cost IT in the $10,000 to $50,000 range, depending on cloud size. "We recommend IT starts with as small a cloud as possible so it can get its feet wet and learn on a smaller dime," Staten says.

Getting started with a complete cloud in a physical box will run IT roughly $150,000, Staten says. "With a complete cloud in a box, you should be able to support most of what the developers would want to put in a cloud anyways."